Its failure to meet its aggressive performance estimates forced its price to be dropped from $13.5 million to only $7.78 million and its withdrawal from sales to customers beyond those having already negotiated contracts. Even though the 7030 was much slower than expected, it was the fastest computer in the world from 1961 until the first CDC 6600 became operational in 1964. PC World magazine named Stretch as one of the biggest project management failures in IT history.[1]

In spite of Stretch's failure to meet its own performance goals, it served as the basis for many of the design features of the fantastically successful IBM System/360, which shipped in 1964. The project lead was initially blackballed for his role in the "failure", but as the success of the 360 became obvious he was given an official apology and was made an IBM Fellow.

IBM returned to Livermore and stated that they were withdrawing from the contract, and instead proposed a dramatically better system, "We are not going to build that machine for you; we want to build something better! We do not know precisely what it will take but we think it will be another million dollars and another year, and we do not know how fast it will run but we would like to shoot for ten million instructions per second."[4] Livermore was not impressed, and in May 1955 they announced that UNIVAC had won the LARC contract, now called the Livermore Automatic Research Computer. LARC would eventually be delivered in June 1960.[5]

In September 1955, fearing that Los Alamos National Laboratory might also order a LARC, IBM submitted a preliminary proposal for a high-performance binary computer based on the improved version of the design that Livermore had rejected, which they received with interest. In January 1956, Project Stretch was formally initiated. In November 1956, IBM won the contract with the aggressive performance goal of a "speed at least 100 times the IBM 704" (i.e. 4 MIPS). Delivery was slated for 1960.[5]

During design, it proved necessary to reduce the clock speeds, making it clear that Stretch could not meet its aggressive performance goals, but estimates of performance ranged from 60 to 100 times the IBM 704. In 1960, the price of $13.5 million was set for the IBM 7030. In 1961, actual benchmarks indicated that the performance of the IBM 7030 was only about 30 times the IBM 704 (i.e. 1.2 MIPS), causing considerable embarrassment for IBM. In May 1961, Tom Watson announced a price cut of all 7030s under negotiation to $7.78 million and immediate withdrawal of the product from further sales.

Its floating-point addition time was 1.38-1.5 microseconds, multiplication time was 2.48-2.70 microseconds, and division time was 9.00-9.90 microseconds.

While the IBM 7030 was not considered successful, it spawned many technologies incorporated in future machines that were highly successful. The Standard Modular Systemtransistor logic was the basis for the IBM 7090 line of scientific computers, the IBM 7070 and 7080 business computers, the IBM 7040 and IBM 1400 lines, and the IBM 1620 small scientific computer; the 7030 used about 170,000 transistors. The IBM 7302 Model I Core Storage units were also used in the IBM 7090, IBM 7070 and IBM 7080. Multiprogramming, memory protection, generalized interrupts, the eight-bit byte were all concepts later incorporated in the IBM System/360 line of computers as well as most later CPUs.

Stephen Dunwell, the project manager who became a scapegoat when Stretch failed commercially, pointed out soon after the phenomenally successful 1964 launch of System/360 that most of its core concepts were pioneered by Stretch.[6] By 1966 he had received an apology and been made an IBM Fellow, a high honor that carried with it resources and authority to pursue one's desired research.[6]

Instruction pipelining, prefetch and decoding, and memory interleaving were used in later supercomputer designs such as the IBM System/360 Models 91, 95 and IBM System/370 Model 195, and the IBM 3090 series as well as computers from other manufacturers. As of 2011, these techniques are still used in most advanced microprocessors starting with the Intel Pentium and the Motorola/IBM PowerPC, as well as in many embedded microprocessors and microcontrollers from various manufacturers.

Fixed-point numbers were variable in length, stored in either binary (1 to 64 bits) or decimal (1 to 16 digits) and either unsigned format or sign/magnitude format. In decimal format, digits were variable length "bytes" (4 to 8 bits).

Floating point numbers had a 1-bit exponent flag, a 10-bit exponent, a 1-bit exponent sign, a 48-bit magnitude, and a 4-bit sign "byte" in sign/magnitude format.

Alphanumeric characters were variable length and could use any character code of 8 bits or less.